2015-12-23

Rat Bastard 2.0 is in a tough spot. He's made a ton of promises to other far-left politicians that he'll hook them up with free money. The problem is, he doesn't have much free money to give and he can't go too far into debt without looking crazy for being upset that the Conservatives went into debt at all.

Yusseff says coming cuts in business employment insurance contributions plus business tax cuts from 23 to 15 per cent mean businesses have plenty of room to contribute to what he calls an essential upgrade to a Canadian pension system that is now broken.

He points out that when it began, CPP was intended as a supplement to private savings and employer pensions. "It was supposed to be a three-legged stool," he said.

But as more people count on CPP (QPP in Quebec) alone, it just isn't enough. The CLC thinks the pension payout needs to double.

Yusseff says most of the planning work has already been done and with success at today's meeting, a new, expanded pension system could be in place as soon as January 2017.

The thing about the CPP is that you and your employer bear the costs, which hurts you and your employer.

But Trudeau doesn't care about you, or your boss. He cares about himself. And for himself, he wants to be adored by Provincial Premiers. And he's willing to bankrupt you to do it. It is, indeed, the reason PMs ever do these meetings, for the cheery post-meeting photo op.

By long tradition, provinces don't come to Ottawa without asking for federal cash.

No doubt that is why former prime minister Stephen Harper stopped meeting with premiers. His strategy instead was to cut federal taxes and transfers, allowing the provinces to raise their own tax money if they were unable to cut spending.

From the point of view of the provincial and territorial ministers, the really big-ticket issue is health care. With Canada's aging population, health needs are growing faster than budgets, and the policy of the former Conservative government pushed the burden increasingly onto the provinces.

Considering, of course, that "the burden" is:a) Entirely the provinces' fault (they could each privatize healthcare tomorrow)b) Entirely the provinces' responsibility
then I don't see why Stephen Harper (pbuh)'s plan wasn't a sound one. As Don Pittis's column notes, provinces just have to raise their own taxes to pay for a program they like. In the long term, doing it this way would be in Ottawa's best interests anyways. Provincial Premiers from Lougheed to Klein to Brian Tobin to Jacques Parizeau loved blaming the federal government for things, and that same federal government didn't exactly make it easy on themselves by saying "hey, we didn't create this program, fund this program, or run this program, why are you mad at us for the program?"

Perhaps more problematic, the evidence based on past CPP expansion suggests that when the government increases compulsory savings, households reduce their voluntary savings, leaving them no better off in terms of total savings. The reason is that Canadians choose how much they save and spend based on their income and preferred lifestyle. If their income and preferences don’t change, and the government mandates higher contributions to government-run pension plans, they will simply reduce their private savings in RRSPs, TFSAs and other investments.

Without an overall boost in retirement savings, the end result is a reshuffling, with more money going to forced savings and less to voluntary savings. The risk then is that Canadians will lose out on the choice and flexibility afforded by private savings in RRSPs and TFSAs.